Housebuilder Ben Bailey has reported a drop in profits of almost 20% in a further sign of the struggling housing market.
The housebuilder’s pre-tax profit was £6.2m for the six months ended 30 June, 18% lower than its 2004 figure of £7.5m. The drop occurred despite a 21% rise in turnover to £45m across the same period. The dividend remained unchanged at 5p.
Chairman Richard Bailey expressed disappointment at the results, saying early optimism had not been met.
He said: “The optimistic view held in the early months of the year failed to be fulfilled after the election. There has been a need to employ more sales incentives to maintain volume output and an efficient build programme.
Improvement will depend on customer confidence
Richard Bailey, chairman
Increases in costs of materials and labour have also contributed to a decline.
“The subdued market conditions will continue to affect margins and any improvement will depend upon a return of customer confidence, possibly driven by a reduction in interest rates.”